COVID-19: Crisis and Growth Opportunities for Profit-Purpose Partnerships
This week, we are fortunate enough to have our peer and friend, Brittany Hill, CEO and Co-Founder of Accelerist, sharing on the blog. She brings a wealth of knowledge on the importance of creating relationships with Nonprofit Partners within your organization’s communities, how to amplify those partnerships to the best of your ability, and how we can use the impact of COVID-19 to create more opportunities in the future.
She will be diving even deeper into the topic on March 31, 12 PM CST, when she hosts a webinar over more growth opportunities for profit-purpose partnerships.
As of March 11, the CDC officially declared COVID-19 a global pandemic. Whether we are working from home, postponing events, attending online classes at college, or stocking up on toilet paper and hand sanitizer, we are all feeling the side effects of the coronavirus in our daily life and work.
Over 170,000 confirmed cases of coronavirus globally1
6,687 deaths from coronavirus1
133/195 countries infected
290 million children have been impacted by school closures around the world2
3,628 people diagnosed, 49 states infected and 63 deaths in the U.S. alone3
Bars and restaurants are mandated to close in several states across the U.S.
MLS, NHL, and the MBA have suspended their seasons
Broadway has gone dark
This….is our new normal.
While COVID-19 may seem like more of an annoyance to some than the Pandemic it is, what we find most interesting is its role on the economy, and the effects that an inevitable recession will have on profit-purpose partnerships.
The deepening coronavirus crisis sent stocks into another landslide on Wall Street last Thursday, triggering a brief, automatic shutdown in trading for the second time last week.
As of March 11, The Dow Jones Industrial Average was down about 1,800 points, or nearly 8%, at midmorning, while the broader S&P 500 was off 6.2%. This is a result of the cascade of cancellations and shutdowns across the globe, an oil pricing war between Russia and Saudi Arabia, and rising worries that the Government and other authorities around the world can’t help the weakening economy any time soon.
“This is bad. The worst and fastest stock market correction in our career,” Chris Rupkey, chief financial economist at MUFG Union, said in research overnight. “The economy is doomed to recession if the country stops working and takes the next 30 days off. The stock market knows it. Bet on it.”
Although most buzz is around COVID-19, it is just one of many other contributing factors (like bubbles European real estate, US stocks, US household wealth, corporate debt, leveraged loans, US student loans, US auto loans, and shale energy) to a predicted and fairly inevitable recession of 2020.
While Broadway might be dark for now, the show must go on for social causes in North America and around the world. From the aging population to the homeless, from refugees to those with compromised immune systems, the coronavirus is most greatly impacting the world’s most vulnerable. Times like these – those of crisis, natural disaster, and recession – are often when communities need social services the most. Yet, philanthropy and social impact seems more difficult and maybe even uncomfortable to pursue.
However, corporate America has gained a reputation for stepping up during dark times, and the last week has been no exception. As reported by David Hessekiel in Forbes last week, Amazon has pledged over $5 million to support small businesses in Seattle impacted by COVID-19, Zoom is offering free video conferencing to K-12 schools around the world, and Facebook, Mastercard, and Apple are donating over $160 million collectively to support relief efforts. Other brands including Walt Disney World Resort, Seamless, GrubHub, Enterprise Rent-a-Car, Lush, Lyft, Uber, Walmart, Postmates, CVS Pharmacy, Aetna, Wells Fargo, and Olive Garden have all pledged varying support for the communities impacted by the coronavirus.
We predicted earlier this year in Accelerist’s new 2020 Trend Report: The 20 Things You Need to Know About Profit-Purpose Partnerships that this would be the year that will accelerate profit-purpose partnerships – the volume of them, the sophistication of them, and the impact they can all have on our societies. While at the time we did not anticipate it would be because of COVID-19, our sentiment remains. We will look back on 2020 as the year we embraced the 4th Industrial Revolution, used technology to make Purpose more interactive and personal, and experimented with new and evolved business models. To make it through 2020 successfully, we will need to make our partnerships immune to threats like the inevitable recession that may flatten corporate budgets and contribute to more turnover, as well as continued sustainability and corporate responsibility reporting pressures. Despite significant challenges, we predict 2020 will be an exciting year – one that will ultimately shape the new frontier for profit-purpose partnerships. In the Trend Report, we uncover the top 5 threats facing impact professionals today, the top 5 most active categories giving to causes, industry trends and exciting new brands to watch. We also offer 20 big ideas for partnerships between nonprofits and companies in the new age of Purpose.
Corporate giving in the U.S. has grown by 15% over the last 2 years, making it a more competitive marketplace for companies that “stand for something” to stand out.1 In the Golden Age of Purpose, most of us that create profit-purpose partnerships know the basics. Now, we must customize, specialize and elevate our partnerships.
With COVID-19 bringing us all closer to using technology to connect and solve challenges, the continued influence of automation, AI, Extended Reality (XR) will be even more important for purpose integration. We have five big ideas for how these industries can leverage their nonprofit partnerships to help attain cross-departmental corporate goals. Some of the common themes and highlights include:
Creating Greater Customer (and Employee) Experiences.
Nonprofits have started to adopt VR and AR to help donors understand what it’s like to experience the missions and audiences they support. This VR app was developed by Alzheimer’s Research UK, and guided by people living with different forms of dementia, to help potential donors understand what the symptoms and struggles are. As a way to create heightened cause engagement and employee loyalty, ask your nonprofit partners for ways you can better connect them with their favorite causes directly from the office. In-app sponsor and brand activation alongside social causes is also an interesting and innovative approach to leveraging your partnerships with XR.
Corporations can provide a lot more value to nonprofit organizations beyond philanthropic dollars. Many tech companies are leveraging their expertise to solve a social issue, or support a mission program within a nonprofit – this is true social enterprise. Take a look at what ZipRecruiter has done to solve the challenges of veteran employment readiness and access through VeteranPost and its partners, HireVeterans.com, HirePatriots and others.
Consumer options across industries are evolving – from autonomous checkout at retail to digital banking and healthcare. Until recently, there were a few ways companies would support nonprofits – grants, employee giving, program underwriting, event sponsorship, POS fundraising or cause marketing. While all of these are still viable and at the core of profit-purpose partnerships, new products and business models are meeting automation and AI to give way to unique partnership opportunities. Regardless of your industry, strive to think differently about the many ways you can partner with nonprofits, leverage their constituent bases, expertise and logistical assets (think: encourage consumer donations via AI like Alexa, co-create social enterprise products with companies that solve your mission challenges, offer in-app donation-with-level up purchases.)
In addition to increased activity within traditional sectors like retail and banking, there are many new sub-categories and rising stars that we’re keeping an eye on this year. Their businesses are continuing to grow, they understand the power of purpose, and we expect they will begin creating progressive partnerships with nonprofits that are willing to grow with them.
The Accelerist Industry Watch List:
Brand Expansions: Traditional brands stepping into new ventures
- Bloomingdales and Urban Outfitters are getting into the reuse/re-wear business
- Wendy’s and Chipotle will continue to grow with their plant-based options
DTC Retail: Direct-to-consumer brands are the new Cinderella story in retail
Any 2020 Future of Retail list raves about the future of direct-to-consumer and names these brands as the shining stars:
- The RealReal
- Rent the Runway
Food Delivery: Groceries, dinner, or dessert – food delivery is here to stay
Traditional restaurants are suffering from the impact of food delivery brands like:
Digital Health: Watch for old and new players in this category
These powerful tools are giving consumers more options, pricing, and metrics about our health:
Men’s Brands: The redefinition of masculinity continues
On the heels of the #MeToo Movement, many male-focused brands are redefining masculinity and finding their purpose. Keep an eye out for moves made by these brands:
In the Chinese Horoscope, 2020 is the year of the Metal Rat. Just two weeks ago, we positioned it to be marked by radical positions and choices. Yet, with a global pandemic spreading, one must carefully measure the risks to ensure ultimate success. While this may prove to be true for your personal, family or professional life, one thing we’re sure of – 2020 is the year for bold new ways for nonprofits and companies to work together to impact change. Dare to think differently, strive to build partnerships that are solution-oriented, and seek out your new hidden gem of a nonprofit that could help further integrate purpose within your company.
What radical moves are you making in partnerships for 2020!?
- live, as of March 16, 2020
- Statista, March 11, 2020
- National Institute of Allergy and Infectious Diseases, March 11, 2020